For those of us that follow the international firearms industry and its major happenings, this is no shocker. Izhmash has led a financially-troubled life since the collapse of the Soviet Union and the company’s rough transition to existing in a free market economy. Like many other weapons manufacturers throughout the former Warsaw Pact, the small arms industry of Russia was powered by the vast amount of state-apportioned resources assigned to it. Decades of the Soviet Union’s policies of freely sharing technical specifications, industrial tooling and simply large amounts of guns with friendly – or potentially friendly – states and groups throughout the Cold War has severely hampered Izhmash’s ability to exercise control over and financially benefit from intellectual property (read: the AK design) and products that it theoretically owns. (For anyone interested in learning about the nature and implications of Soviet-style arms manufacturing and stockpiling, I highly recommend C.J. Chivers’ The Gun.)

AK-103 rifle in 7.62x39mm. One of the newer offerings from Izhmash, adopted as the service rifle of the Venezuelan Army.

Precisely what this news means for AK enthusiasts in America is unclear. I agree with Steve’s analysis that the Russian government will probably bail out Izhmash and doubt that it will actually introduce new policies and procedures to ensure the company remains financially viable in the long-run, instead keeping the concern functioning as its main military supplier. Izhmash has to deal with the fact that the longevity of AK rifles on the battlefield has significantly reduced their ability to make big moves on the military small arms scene, barring any revolutionary developments (which they seem to have a hard time with – their “new” AK-12 basically amounted to slapping a bunch of features onto the classic AK design that had already been available on several other countries’ modifications of the AK and in the commercial aftermarket).

As far as I know, the only big military buys to happen within the last several years was Venezuela’s adoption of the AK-103 and AK-104 (the most-modern version of the AK-47 and a carbine version of the -103, respectively) as the standard rifles of their ground forces, with a deal to set up their own factory for the guns. Izhmash really needs to find a way to make itself commercially viable in a global firearms market, including moving away from its military small arms focus and pushing more and more for acceptance as a quality civilian firearms manufacturer.

That’s not to say that Izhmash hasn’t already experienced success with its sporting arms – indeed, according to the Russian-language news article linked above, the sporting division of the company has grown significantly in the last several years. It may simply be time to curtail military production in favor of a smaller and efficient civilian-focused arms production.

Shooters in the United States are most likely to have seen Izhmash’s products in the form of Saiga sporters and shotguns, the non-military hunting-style rifles and shotguns based on the AK design. Versions of the rifle that are more true to “military” form, like Arsenal, Inc’s SGL series of rifles, are also available in the US.